Coastal States Oppose Offshore Drilling Proposal

February 8, 2018

Attorneys general of a dozen coastal states—North Carolina, California, Connecticut, Delaware, Maine, Massachusetts, Maryland, New Jersey, New York, Oregon, Rhode Island and Virginia—are expressing opposition to the Trump administration’s proposal to expand development of oil and gas in the Atlantic and Pacific oceans, calling it “outrageous” and “reckless.” In a letter, they called on U.S. Department of the Interior Secretary Ryan Zinke to cancel the proposal. They also expressed ire at the deal Zinke struck with Florida Gov. Rick Scott, which exempted his state from the drilling plan, pointing to the lack of analysis or clear process underlying the decision.

Two governors from opposing parties echoed that sentiment in a separate publication.

“We’ve seen this administration seemingly lift the concerns of one governor and one state above others,” wrote Maryland Gov. Lawrence Joseph Hogan Jr. and North Carolina Gov. Roy Cooper in an op-ed. “In removing Florida from the five-year plan, Zinke and the Trump administration have admitted that offshore drilling poses great risks to coastal economies.”

On Sunday Zinke reiterated why he exempted Florida—due to its unique currents and geology as well as the unanimous opposition of Florida’s legislature to the proposal.

“In the case of Florida, the governor asked first for an immediate meeting and every member on both sides of the aisle contacted my office, wrote letters on it. So Florida is unique,” Zinke said. “Not every state has all the members against it and the geology is different, the currents are different and so looking at it, we’re going to take the process, go through it, meet with every governor personally.”

In a meeting with Zinke the day before, Cooper said the Interior secretary was receptive to his requests for an extended proposal comment period and for three additional public hearings near North Carolina’s coast.

“He said that he was listening, and he heard each and every one of us,” Cooper said. “I think generally he was pretty positive about what we said. He didn’t make any promises to us.”

“We told him there is no 100% safe method to drill for oil and gas off the coast, particularly in our area off of North Carolina that sees nor’easters, that sees hurricanes,” Cooper said. “It would be catastrophic if there were to be an oil spill.”

If North Carolina does not get an exemption like Florida, Cooper said he has no problem taking the federal government to court.

“Thousands of North Carolinians and 30 coastal communities have voiced their opposition to drilling off North Carolina’s shores,” said Josh Stein, North Carolina’s attorney general, in a statement. “I will do everything I can, including taking legal action, if necessary, to fight on behalf of our people, economy, and natural resources.”

Also seeking an exemption from the proposal—albeit a partial one—is Alaska Sen. Lisa Murkowski.

“There are certain areas that we feel are not opportune for leasing and for development,” said Murkowski, who chairs the Senate committee that oversees the Interior. “Let’s focus on where the opportunity is good and there is interest and defined resource with limited obstacles.”

As Another Plant Closes, Spotlight Is on Economics of Nuclear

New Jersey’s Oyster Creek nuclear power plant will shut down in October 2018, more than a year earlier than planned, Exelon Corp. announced last week.

Nuclear power is the nation’s largest source of carbon-free electricity, generating about 20 percent of U.S. electric power and 60 percent of our zero-carbon electricity. The challenge to maintain a zero-carbon nuclear fleet to meet climate goals—by keeping existing plants like Oyster Creek—often is economics. This challenge has been particularly apparent in competitive markets, where nuclear plants are not guaranteed cost recovery through ratepayers.

When Exelon CEO and President Chris Crane announced in 2010 that the plant would retire in December 2019, he said the plant faced “a unique set of economic conditions and changing environmental regulations that make ending operations in 2019 the best option for the company, employees and shareholders.” He said the plant’s decreasing value was due to the cumulative effect of negative economic factors, such as low market prices and demand, as well as the plant’s need for continuing large capital expenditures.

Meanwhile, new construction has been plagued with cost overruns. In December 2017, the Georgia Public Service Commission voted unanimously to allow construction of two new nuclear reactors at the Plant Vogtle site to proceed. Plagued by delays and escalating costs, the Vogtle reactors represented the only large-scale nuclear construction underway in the United States since abandonment of two reactors last summer by South Carolina Electric & Gas and Santee Cooper. The Georgia commission reaffirmed its decision this week, despite a challenge by consumer group Georgia Watch over concern about the ultimate cost to ratepayers.

EIA Projects United States Will Become a Net Energy Exporter in 2022

The U.S. Energy Information Administration (EIA) on Tuesday released its annual long-term energy outlook, which projects U.S. production of natural gas will increase through 2050. Production of crude oil and petroleum products, meanwhile, will decrease.

It projects that the United States will become a net energy exporter by 2022, four years sooner than the date projected in last year’s report, reversing “a near 70-year trend when the U.S. became a net energy importer in 1953,” said EIA Administrator Linda Capuano.

“The United States energy system continues to undergo an incredible transformation,” she added. “This is most obvious when one considers that the [report] shows the United States becoming a net exporter of energy during the projection period in the Reference case and in most of the sensitivity cases as well—a very different set of expectations than we imagined even five or ten years ago.”

Renewable generation more than doubles between 2017 and 2050, in EIA projections, with an average annual growth rate of 2.8 percent. EIA projections show 80 gigawatts of new wind and solar photovoltaic capacity being added between 2018 and 2021, spurred by declining capital costs and the availability of tax credits.

Energy consumption grows about 0.4 percent per year on average in the Reference case from 2017 to 2050, which is less than the rate of expected population growth (0.6 percent per year), according to the report.

Meet the Author

Tim Profeta is the founding director of the Nicholas Institute for Environmental Policy Solutions. The Nicholas Institute is part of Duke University and focuses on improving environmental policy making worldwide through objective, fact-based research in the areas of climate change, the economics of limiting carbon pollution, oceans governance and coastal management, emerging environmental markets and freshwater concerns at home and abroad. In his role at the Nicholas Institute, Profeta has continued to use his experience on Capitol Hill to engage in climate change debates. His research has focused, specifically, on market-based approaches to environmental regulations—particularly energy and climate change policy. Other projects engage his expertise in environmental law and air pollution regulation under the Clean Air Act.

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